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What Is Car And Auto Insurance?
Auto insurance is something that most of us have either used or at least heard about. It's one of the most important financial assets you can have to protect your bank account from ruin after an accident!
As you probably know, this form of insurance helps you pay the bills to repair your car (as well as the other car if you're at fault) in an accident. You usually have to pay some kind of deductible, and then your insurance company pays the rest.
Why do I say that this is so important? The main reason is that hundreds of car accidents happen every day. In fact, the most dangerous thing that you do is probably just driving to work or school! Even "high risk" activities such as sky diving or bungee jumping aren't as dangerous as driving.
Because accidents are so common, do you think there's a chance you might get in one sometime in your lifetime? Even if it isn't your fault, what happens if you get an in accident and the other guy doesn't have insurance? That can set you up for a bad day because if you don't have insurance either, you have no way to pay for repairs except from your own pocket!
Also consider this- when you start having your kids drive, do you think auto insurance is important? If they're like most teens, they'll get in at least one accident before they learn the rules of the road and how to stay safe. And even though the accident will probably be their fault, they don't have the money to pay out of pocket, so it has to come from yours!
Hopefully you can see why auto insurance is so important. It protects your finances whether you hit a tree, an uninsured driver hits you, or you spill hot coffee on your lap and swerve into another lane hitting a car.
So even though it's so important, many people (millions in fact) decide not to get it. Why?
Well there's a few reasons. The main reason is the cost. The insurance companies decide how much your premium is based on several things. Age, gender, driving history, the car you're driving, where you live, etc.
If you're a young male who has had a few accidents and drive a sports car, your insurance is going to be sky high (if they insure you at all!) They have to do this because you're a huge risk to them, so they want to make sure they cover themselves by charging you high monthly premiums. And because most young people don't have a lot of money, they may not be able to afford it and just choose to go without insurance.
Because of these costs that you have to pay in addition to your car's monthly payment, consider getting a less expensive car. Many people will purchase a new car this year thinking "that $300 a month payment isn't bad", forgetting that insurance might add on another $100 or so!
Another reason people don't get auto insurance is they think they just don't need it. They're a great driver- no accidents in the past or anything, so they're all set, right? They won't be getting in any accidents in the future. Well again, this is a flawed way of thinking. While it may be true that you're a good driver, there's no guarantee that the guy next to you knows what he's doing!
Whether you're 16 or 46, you're legally allowed to operate a motor vehicle. Don't think that just because you've come to be 46 without a single accident, that 16 year old behind you is going to have the same kind of luck. Getting insurance is to help protect you from drivers like this- period.
There are a number of other reasons why you should get car insurance. For example, in some states it's illegal to drive a car without insurance. In that case if you get in an accident, you not only have some car repair bills to pay, but also answer to the cops about why you aren't insured! That can be a hefty fine depending on the state.
Another reason is that auto insurance can help you sleep better at night. Think about it- if one single accident can destroy a year's worth of wages in auto repair and medical bills, don't you think you'd have trouble sleeping at night? You might never want to drive again!
Instead, the better option is to accept that auto insurance is necessary and pay the monthly premiums.
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A Look At What Car Insurance Is And Why It's Needed
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